Overview

This Return on Invested Capital (ROIC) Template shows how to arrive at the value of the previous period book of invested capital, as well as the current period NOPAT and use these two values to calculate ROIC. This profitability measure is used to determine how well a company used the resources from its bondholders and stockholders and transformed them into operating income. The formula for ROIC is the following:

ROIC = [EBIT (1 – T) ] / BV of Invested Capital

Where:

BV of Invested Capital = Book Value of Debt + Book Value of Equity + Minority Interest – Goodwill – Cash

EBIT (1-t) = NOPAT

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